GTA Housing Market Shifts to Balanced Territory: July 2026 Report Analysis
Falling Supply Pushes the Market into Balance in July
The GTA housing market tightened in July, with the shift driven by decreasing supply. Sales dipped slightly from a year ago—pausing a four-month streak of annual gains—but the far larger move came on the supply side, where new listings fell nearly 18% and dropped below their 10-year average. As a result, the sales-to-new-listings ratio climbed back above the 40% mark that signals a balanced market, and months of supply continued to recede alongside active listings. With the mix-adjusted benchmark price again edging higher month-over-month, the data point to a market that is steadily rebalancing as the summer progresses.
Winning Streak for Sales Pauses with a Slight Dip: The 5,995 MLS sales in July edged down 0.9% from a year ago, ending a four-month run of year-over-year gains. The decline was marginal and owed more to decreasing supply than to softening demand—on a seasonally adjusted basis, sales rose month-over-month, extending the recent run of monthly gains. On a year-to-date basis, sales through July are up 1.1% compared to the same period in 2025. However, July sales remained 18% below the 10-year average.
New Listings Fall 18% as Sellers Hold Back: New listings dropped 18% year-over-year to 14,484 homes—a seventh straight month of annual declines and falling 5% below the 10-year average. With new listings falling as sales were relatively steady, active listings at month-end declined 12% from a year ago to 26,098 homes—the sixth consecutive month of annual decline and the third consecutive in double digits. Even so, active listings remained at their second highest level of the past decade and 38% above the 10-year average.
Market Moves into Balance: The sales-to-new-listings ratio rose to 41% in July, up sharply from 34% a year earlier and back above the 40% mark that denotes the lower bound of a balanced market, representing the strongest reading for any July in five years. Months of supply eased to 4.4, down from 4.9 a year ago and continuing to trend steadily lower. With sales capturing a growing share of new listings and inventory being absorbed, buyers are likely to find less room to negotiate in the months ahead.
Average Price Decreases for 18th Straight Month: The average selling price declined on an annual basis for the 18th consecutive month in July, down 4.5% to $1,003,956—the lowest average price for any July since 2020. A meaningful part of that decline reflects a shift in the sales mix toward lower-priced homes rather than broad-based price weakness. The mix-adjusted MLS Home Price Index benchmark edged up month-over-month on a seasonally adjusted basis, even as the headline average dipped. Prices are now little changed over five years (down about 6%), and the 10-year average annual growth rate has slowed to 3.7%—well below the long-run rate of roughly 6%—suggesting good upside potential as conditions continue to improve.
Detached and Condo Sales Hold Steady: Sales were essentially flat year-over-year in the two largest segments—detached sales edged up 1% to 2,789 units and condo apartments were unchanged at 1,564—while the modest overall dip was concentrated in semis, rows and townhouses, where combined sales fell 4% to 1,560. That softness coincided with a 22% annual drop in new listings for the segment and may reflect growing competition from the new-home market, where the full HST rebate has improved the relative appeal of new construction. On a year-to-date basis, detached sales are up 4%, condo sales are flat, and sales of semis/rows/towns are down 3%.
Condo Supply Tightens Sharply as New Listings Fall for an 11th Month: Active condo listings fell 15% year-over-year in July to 8,352 units, while new condo listings dropped 18%—the eleventh consecutive month of annual declines. Beyond the slowdown in new completions, a growing share of investors appear to be renting out units rather than selling into a soft market. The rapid drawdown in supply pushed the condo sales-to-new-listings ratio up to 37%, its highest July reading in five years and closing in on the 40% balanced market threshold, while condo months of supply fell a full month from a year ago, from 6.3 to 5.3. Supply tightened across every housing type—new listings fell 15% for detached homes and 22% for semis/rows/towns—underscoring that the summer's softening in activity was led by sellers stepping back rather than by a drop in demand.
Semi-Detached Homes Are the Tightest Segment in the GTA: Semi-detached homes were the most competitive segment in the GTA, with just 2.3 months of supply and sales closing at an average of 100% of the asking price. The broader semi/row/town category sat at a balanced 3.4 months with an above-average sales-to-new-listings ratio of 48%. Detached supply eased to 4.4 months (from 4.8 a year ago) and condo apartment supply decreased to 5.3 months (from 6.3), leaving both within reach of balanced territory as the inventory overhang recedes.
Condo Prices Begin to Stabilize: The price trend diverged by segment in July. Condo apartment prices fell just 2% year-over-year—a marked improvement from the 9% decline recorded a month earlier—and edged higher month-over-month, an early sign of stabilization. Detached and semi/row/town prices, by contrast, declined 5.1% and 5.5%, respectively, weighed down by a heavier mix of entry-level sales. Notably, condos remain among the strongest performers over the long run, appreciating roughly 56% over the past decade versus about 48% for semis/rows/towns and 36% for detached homes.
Condo Demand Ramps Up in the High End: Condos priced under $500K accounted for a 38% share of condo sales in July, up from 26% a year ago, as volume in that range climbed 45%. The $400-499K band alone made up 27% of condo sales, and condos priced under $600K represented 63% of the segment. At the same time, the top of the market showed renewed life as sales of condos priced above $1.5M rose 28% year-over-year—albeit from a small base and representing only 3% of condo sales. The $500-900K mid-market was the softest part of the condo segment.
Low-Rise Sales Growth Confined to Homes Under $900K: For low-rise homes, every price band below $900K posted year-over-year sales gains in July, while every band at $900K and above declined—a split that shows how affordability is steering demand. Growth was strongest at the entry level, with sales under $600K up 71% (though still only 6% of low-rise activity). Homes priced under $900K collectively accounted for 41% of low-rise sales, up from 34% a year ago.
Toronto Central and Peel Lead Detached Sales Growth: Detached sales jumped 19% year-over-year in Toronto Central and 14% in Peel Region—the strongest gains among the major markets—while Durham (-13%) and Halton (-6%) lagged. Detached supply across the City of Toronto tightened to 3.8 months, dipping as low as 3.1 months in Toronto East, while York Region carried the highest detached inventory in the GTA at 5.1 months.
Sales Rise Across the Board in Toronto and Fall Across the Board in the 905: Within the City of Toronto, sales rose year-over-year across all three major housing types (detached: +3%, semi/row/town: +1%, condo: +3%), while across the 905 they fell for all three (detached: -1%, semi/row/town: -5%, condo: -7%). Supply for semis, rows and towns was tightest in Toronto East at just 2.5 months—the most competitive market segment in the GTA.
Central Toronto is the Standout in the Condo Market: Central Toronto—the GTA's largest condo submarket—was the best-performing condo segment in July, combining the strongest sales growth of any major region (+7% year-over-year) with one of the smallest price declines (-1%) and one of the lowest months of supply (4.8). Condo sales also rose in Toronto East (+2%) and Halton (+3%) but fell in Peel (-19%) and York (-4%), where inventory remained more ample at 7.5 and 6.1 months, respectively.
Key Takeaways
July's numbers showed the market moving into balance as supply pulled back. With sellers increasingly content to wait for better prices and buyers still finding openings at the entry level, the inventory overhang accumulated since 2022 continues to erode.
With prices still running roughly 25% below their early-2022 peak, much of the large cohort that bought during the 2021–2022 boom would be selling at a large loss today as their mortgage renewals come up, and many are choosing to hold out for firmer conditions rather than list into a weak market. This is consistent with survey measures of listing intentions that turned lower heading into 2026 and leaves a pool of shadow supply that could enter the market once prices begin to improve.
The evidence of a cyclical price bottom continues to build. The mix-adjusted benchmark price continued to edge higher month-over-month on a seasonally adjusted basis even as the headline average declined. Condo prices in particular showed stability in July, down just 2% year-over-year and higher month-over-month. With the average price at its lowest July level since 2020 and supply tightening across every housing type, the ingredients for stability and renewed appreciation are increasingly in place—most immediately in the low-rise segment, where balanced-to-tight conditions already prevail.
The broader economic backdrop has turned decidedly more constructive over the summer. Canada's economy expanded at a 3.4% annualized pace in the second quarter—well ahead of the Bank of Canada's 2.5% projection and a sharp rebound from the slight contraction to start the year. Roughly 75,000 jobs were added in July, far above expectations, pushing the unemployment rate down to a two-year low of 6.4%. Improving sentiment has been echoed in record highs for the S&P/TSX Composite and a broadening of retail spending into big-ticket categories such as autos. The Bank of Canada held its overnight rate at 2.25% on July 15 and reaffirmed a data-dependent stance. With growth and jobs surprising to the upside, markets have largely priced out further rate cuts, and the balance of risk has tilted toward rates holding steady or edging higher should energy-driven inflation broaden through the remainder of 2026.
Five-year Government of Canada bond yields have climbed back above 3.2%, near the upper end of their recent range, exerting mild upward pressure on fixed mortgage rates that had been sitting at around 4%. Headline inflation, meanwhile, cooled to 2.8% in June from a gasoline-driven 3.2% in May, and the Bank expects it to ease back toward 2% by early 2027, keeping underlying price pressures contained. The principal near-term risks to yields are energy prices from the U.S. conflict with Iran and the trajectory of trade and tariff negotiations under the ongoing CUSMA review.
The condo market's recovery is gathering pace, led by resale market improvements in Central Toronto. On the new-construction side, Urbanation's second-quarter data showed GTHA new condo sales rising 52% year-over-year—the first annual gain since 2023—as the elimination of HST on new homes and a return of investor interest began to revive demand, even with sales still far below historical norms. Just as important, the future-supply pipeline is contracting sharply as no new projects launched for a second straight quarter, construction starts fell to only a few hundred units, and the pre-construction and under-construction pipeline has shrunk 37% from a year ago and 62% from its 2022 peak. With condo supply set to record its largest-ever decline in the years ahead, the conditions for price stabilization and eventually recovery are increasingly falling into place.
